Controversial counter-terrorism projects worth more than £1.2m are to have
their funding withdrawn in the first sign of a tougher approach on tackling
violent extremists.

The first to be hit is the Street project, which is associated with Brixton Mosque in South London. The project has received more than £500,000 in three years from the government.

The Daily Telegraph has learned that the Home Office has told the project it will have its money withdrawn this year in the first step towards switching funding away from strains of Islam with which the government disagrees.

The Street project is likely to be only the first to feel the effect of the new policy, with other organisations including Siraat, a £500,000 prison-based mentoring project across southern England and Impact that has received £280,000 and is based in Hounslow, West London, both facing closure.

The move follows a speech by David Cameron a week ago in which he declared that the doctrine of multiculturalism had "failed" and would be abandoned.

The Office for Security and Counter-Terrorism (OSCT) is already driving a major re-think of a project called Preventing Violent Extremism.

This project has been criticised by both libertarians who claim it is an excuse to spy on Muslim communities, and others who claim it is funding non-violent groups which nevertheless propound fundamentalist schools of Islam such as Salafism from Saudi Arabia and Deobandism from South Asia.

Proponents of the scheme say that the only way to engage with young men on the verge of becoming terrorists is to talk to those whose ideologies they support.

But Charles Farr, the head of the OSCT, is aiming to cut funding to organisations with what are considered “divisive and extreme beliefs” as Prevent is re-fashioned to exclude “non-violent extremists.”

When ministers arrived in the Home Office they are understood to have been shocked to find that there were no criteria on which groups to fund, little information about how much they were receiving and no proper auditing of their effectiveness.

Part of the problem was the speed with which Prevent was enlarged three years ago in an attempt to fill a gap in providing help to Muslim communities in tackling extremism.

Brixton mosque was attended by Richard Reid, the shoe-bomber and by Zacarias Moussaoui, the so-called “20th hijacker” who was arrested before the September 11 attacks. The Street project – Strategy to Reach Empower and Educate Teenagers - was designed to try and help prevent others following their example and deals with a high proportion of black converts as well as Somalis and Algerians.

It currently employs 12 staff and received £326,990 in 2009-2010 and £191,310 from 2010 until October this year.

It caters for Muslims from across South London, providing sports and social activities at the mosque youth centre and running classes on Islamic religious precepts, social responsibilities and citizenship. Over the last 18 months, it has completed 12 of the 40 cases it has managed.

The Street project was founded by Abdul Haq Baker, who is its secretary and one of its directors. Mr Baker is also a trustee of the Brixton Mosque and Islamic Cultural Centre.

A report by the Policy Exchange think-tank in 2009, called “Choosing our Friends Wisely” pointed out that the mosque followed the Salafi school of Islam, and although it is non-violent, Mr Baker said in an interview that Richard Reid, the shoe-bomber and a former worshipper at the mosque, was “happy that we weren’t going to be feeding him rhetoric or erroneous beliefs.”

“Wind-down funding” will be provided to allow the project to manage five counter-terrorism “interventions” and five other interventions.

The project deals with many ex-offenders and the Home Secretary has ordered officials to work with the National Offender Management Service and the Metropolitan Police to consider alternative providers.

Since this article was first published we have been asked to make clear that the Street Project is not run from the Brixton Mosque premises.